Despite the rising stress on balance sheets of domestic banks, foreign investors in recent months have been snapping up bond issues because of lack of quality issuances in the global market.

While SBI set the tone by raising $1.25 billion at a low 375 bps over U.S. treasury, the record low money was cornered by the Exim bank at 355 bps over the 5-year US treasury note in its $500 million fund raising.

One basis point is one-hundredth of a percentage point.

State Bank's issue was largest-ever from a domestic bank. It was oversubscribed around 6 times, pointing investor appetite in the issue of largest public lender of the country.

Similarly, the Exim Bank raised $500 million in overseas bond issue priced 3.55 percent over the 5-year treasury note, making it one of the cheapest by a financial institution in recent time.

As per an analyst, the greater interest in the Exim Bank bonds was due to its 100 percent ownership by the government.

Barring SBI and Exim Bank, others namely Axis Bank, ICICI Bank, Indian Overseas Bank and Union Bank of India have also raised money from foreign investors through bond issuances in the past month.

While Axis bank raised $250 million that was priced 390 bps over the 5-year U.S. treasury paper, ICICI Bank raised $750 million at 400 bps over the treasury notes.

Meanwhile, public sector lender Indian Overseas Bank raised $500 million with 405 bps over the treasury note and Union Bank of India had raised $350 million with a yield of 390 bps over the US treasury note.